The standard handout is 2 weeks of the already substandard pay and a “don’t let the door hit you in the ass on the way out” as you are told to be gone within an hour or so from receiving notice. This is about on par with the treament the people I knew from there got during their employ, so no suprises there’s massive brain drain long before this current wave of layoffs.

They broke two of the most fundamental tenets:

Business Rule 1: Know what you’re selling (business plan)
Business Rule 2: Take care of your talent (meritocracy)

These are especially important in any creative field, even a low end market like “stock advertising”. Oh well, there’s a big lesson for the next batch of startups on our next upswing…

The whole company was built on buzz. New employees were offered sub-par salaries and tens of thousands of stock option each year, which would only be fully vested after four years and if and only if the company went public. New employees were thinking, “SpotRunner is the next Google.” With options valued at under a dollar, new employees were thinking that they’d cash them out for $10/share minimum, and take home an extra $500,000 – $5M after working only 4 years. Therefore everybody jumped at the opportunity to get part of the action.

The reason why the old time directors and solid employees left, especially good ones like Tim Lambert, David Day, and Cindy Gauger, was because they eventually realized that they’d never become rich cashing in those worthless stock options. The former CFO and now President, John Gentry, and his ex-Overture cronies, Dan Scholnick, Justin Wheeler, along with the poor direction of Nick Grouf, were too busy focusing on minutiae and not enough on producing a product that worked well.

Within my first two weeks on the job, I could look at the numbers and see how little money the company was actually making. I doubt it was enough to pay the rent on the Wilshire office as well as the sub-par employee salaries. They never had a good enough strategy to make money. Too much time was wasted on obtaining small business customers, which was the whole reason the company was founded. Finally after 12+ months of floundering with this broken strategy, they shifted focus on national accounts.

But even if many businesses contract with SpotRunner to handle their national advertising accounts, they still don’t earn that much money. At the end of the day SpotRunner is a TV spot broker: they buy discounted TV commercial time and sell it for a small profit. It is really not a business that scales too well, since they have to bid on air time just like everybody else.

It is all blue smoke and mirrors at SpotRunner. There was a big brain drain and it’s just a bunch of washed out wanna-bees with a sunk cost of a time investment that will never pay off. I almost feel sorry for my old co-workers and bosses who are still there.

Almost.

After inquiring about TV ads their sales reps sent me an email pitching SEO. It looked like it was written by a ten year old. I couldn’t imagine giving them money.

Spot Runner never passed the smell test. They supposedly were a technological improvement on buying media, but they were never connected to the buy side or the sell side. At the same time they were telling people that they were fully integrated. Unfotunately they never talked to the buy or sell side systems, let alone spent the dozens of man years necessary to make the connections. Spot Runner was a complete con job of the investors to the people who joined the company thinking that the company had something special rather than just a pile of BS

And bitter? You bet.